Euro marks 26 years in use
Anadolu Agency
The euro, now in its 26th year, faces challenging economic conditions in the eurozone.
Introduced in 1999 as a dematerialized currency for accounting and electronic payments, it became physical currency in 2002, used daily by 350 million people in 20 EU member states. The European Central Bank (ECB) oversees the monetary policy, aiming to control inflation below 2% by adjusting interest rates.
The euro, the world's second most significant currency after the US dollar, circulates in seven banknote denominations and various coins. The €500 note was discontinued in 2019 due to concerns over money laundering and terrorism.
While all EU countries, except Denmark, are required to adopt the euro if eligible, Croatia joined the eurozone in 2023, and Bulgaria is expected to follow.
The euro's value has fluctuated since its launch. After a drop to $0.83 in 2000, it reached $1.60 in 2008, but geopolitical tensions and global crises led to a 16% depreciation against the dollar in 2022.
Despite recovery in 2023, the euro faced pressure from various factors, including Donald Trump’s election win, and ended 2024 at $1.04, near the $1 parity last seen in the early 2000s.
Globally, the euro’s role has diminished, accounting for 19.76% of global reserves in 2024, down from 25% in 2003. Its share in global payments also declined to 22.9% by October 2024.
In response to changing financial landscapes, the ECB is developing a digital euro, expected to complement traditional currency and be available for public use. With a regulatory framework being established, a draft rulebook is anticipated in early 2025, offering a reliable and stable digital payment option across Europe.
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